S&P might lower Hapag-Lloyd

Standard & Poor's said it placed its B+ long-term corporate credit rating on Hapag-Lloyd AG as well as its B- issue rating on the company's senior unsecured notes on CreditWatch with negative implications.

S&P said the CreditWatch placement reflects its view of uncertainty over the implications of the potential merger with container shipping operations of United Arab Shipping Company SAG (UASC) on Hapag-Lloyd's future capital structure and financial leverage.

While no binding agreement has been singed, no assurance can be given that the discussions between Hapag-Lloyd and UASC will lead to a definitive agreement, and financing conditions of thepotential transaction and credit quality of UASC are uncertain, the potential merger, in the agency’s view, might trigger a weakening of Hapag-Lloyd's financial risk profile, which S&P currently assesses as aggressive.

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